Sales at U.S. stores open for at least 12 months fell 0.9% during the nine-week period that ended Jan. 4, compared to the 2% gain expected by analysts. Best Buy now expects to report a decline in operating profit when it unveils fiscal fourth-quarter financial results on Feb. 27.

Wall Street was stunned. Best Buy plunged 28.5% to $26.88 in afternoon trading with nearly 74 million shares changing hands. The stock is now down 40% from its 52-week high of $44.66.

"When you see a stock down 30% in a single say you don't necessarily rush to buy it," warns Brian Sozzi, CEO and chief equities strategist at Belus Capital Advisors. "The market is trying to tell you something and you should listen."

Investors who believed that Best Buy CEO Hubert Joly could turn around the company, amid worries that its stores had become little more than showrooms for online shoppers, have learned it's going to be a very bumpy ride regardless of the final outcome.

The company says it won market share, but that didn't help sales. Also, the added store hours increased costs, which hurt margins.

And now, the Street is left with little visibility regarding how much Best Buy might actually earn in the new fiscal year, which starts next month.

As of Wednesday, consensus estimates among analysts surveyed by Thomson Reuters forecasted a 16% gain in fiscal 2015 earnings to $2.83 a share on revenue of $43.3 billion.

For now, Best Buy plans to continue its promotions. Joy, however, concedes that the company needs to get leaner. A top priority is to improve online sales and deepen its existing cost-cutting program.

Best Buy is $550 million into the $750 million restructuring plan it unveiled in November 2012. Belus' Sozzi sees Best Buy raising that target as high as $1 billion and closing as many as 100 stores.

"There was nothing on the conference call [between management and analysts] to hang our hat on," says Sozzi, who plans to publish a note Friday downgrading Best Buy, which had been among his 2013 top picks. "Over the next few days you will see earnings estimates come down drastically and more negative notes that put more pressure on the stock."

Sozzi sees the stock falling another 10% by the time Best Buy releases fourth-quarter earnings next month.